The volume knob continues to turn in the right direction for Sirius XM Radio (NASDAQ:SIRI). The satellite radio provider posted strong quarterly results on Tuesday morning, once again fortifying its outlook along the way.

Sirius XM closed out the quarter with a record 28.4 million subscribers after closing out the month of June with 692,000 more users than it had at the end of March. Self-pay subscribers came through with a 519,000 sequential increase to clock in at 23.4 million.

Bears love to talk up how Sirius XM is transitional technology, arguing that it may be better than terrestrial AM and FM radio but it's no match for cheaper mobile apps. With more and more connected cars on the road making it seamless to stream Spotify or iTunes playlists from a Bluetooth-enabled vehicle, naysayers feel that folks will cancel their satellite radio subscriptions in droves. Well, it's not happening.

Even with Sirius XM increasing its standard monthly rate twice since early 2012 -- and passing along the annually increasing music-royalty fee obligations -- folks are sticking around. Premium radio has become an indispensable platform for commuters and other drivers. Monthly churn was 1.6% during the quarter, the lowest that metric has been since Sirius and XM were allowed to tie the knot in 2008. That's the good news. The bad news is that Sirius XM's conversion rate -- the percentage of users on new trials that ultimately convert into paying subscribers -- fell to a postmerger low of 41%. 

Sirius XM reported $1.12 billion in revenue, 8% ahead of last year's second quarter and in line with what analysts were targeting. Year-over-year growth has decelerated to the high single digits in recent quarters, but that's natural as the media giant matures.

The good news is that Sirius XM's high fixed costs make this an extremely scalable model. A modest uptick in revenue usually results in bigger gains as we work our way down the income and cash-flow statements.

Back out a one-time settlement related to royalty litigation and adjusted earnings rose 29% from the prior year to hit $170 million. That amounts to just $0.03 a share given the gargantuan number of shares outstanding at Sirius XM, but we're still talking about adjusted net income once again outpacing revenue growth. 

Sirius XM is encouraged by its near-term prospects, boosting its guidance for subscribers, revenue, adjusted EBITDA, and free cash flow for all of 2015. It's now expecting to add 1.8 million net subscribers and 1.6 million self-pay ones. It's targeting revenue of $4.5 billion, adjusted EBITDA of $1.62 billion, and free cash flow of roughly $1.3 billion.

These are good times for Sirius XM investors. The media giant is more than living up to its expectations, leaving the bears shaking their heads for a shakeout of subscribers and a market cap that doesn't seem likely to materialize anytime soon.